Factors Affecting The Location of Industries
An industry is a place where production of goods from raw materials takes place. Physical and socio-economic factors affect the location of industries. Relief, climate, water, raw material and energy resources are included in physical factors, whereas capital, labour, transportation, market and policy of the Government arc social and economic factors.
Industries are located away from the residential areas and agricultural fields. Mountain slopes and uneven lands are not suitable for an industry. Affordable land and some other factors are taken into consideration. However, climate does not have major influence on determining the location of the industries. Climatic condition of a region plays an important role in influencing the location of cotton, milk, wool, fruits and sugarcane production.
For manufacturing processes, especially in food processing and chemical industries, plenty of water is essential for different tasks like cleaning, as well as cooling the products and machineries. Moreover, hydroelectric plants also require ample amount of water.
Raw materials that are classified as heavy, bulky, weight losing, pure, non-weight losing and perishable arc important aspect of any manufacturing industry. Usually, weight losing and perishable type of raw material based industries are situated near the source of raw materials. On the other hand, non-weight losing raw material is located near market place.
Energy resources such as coal, mineral oil and natural gas are essential to alter raw materials into finished goods. These resources affect the location of the industry. Iron and steel industries require coal as an important energy resource. As coal is very bulky and weight loosing material, such industries are located near coalfields. Today, many industries prefer using petroleum and natural gas as it is convenient to transport through the pipelines.
Capital is an essential aspect for the establishment and functioning of any industry. Large sum of capital is not only required for production but also for marketing. Heavy capital is needed for purchasing different equipment, land and labour. Capitals are raised with the help of grants sanctioned by Government, banks and foreign investments.
All manufacturing units require labour. Ability of labour largely depends on wages, space, time, quality and skill. Skilled labour is needed in chemical and engineering industries, diamond cutting industries, etc.
Transportation plays an important role in providing raw material to the industries and finished goods to the market places. Although water transportation is the cheapest, railways are mostly preferred. As airways are the fastest mode of transportation, they contribute to transport delicate and valuable goods as well as modem technology.
Goods are made available for consumer in the markets. In order to reduce the cost of transportation, industries like automobiles, glass work, crockery, food products, etc. are located near the market places.
Policies of the Government plays significant role in determining the location of the industries. Government plans the location by distributing industries in remote areas. It provides many facilities like tax reduction, concession in electricity, sufficient water supply, set-up facilities, etc. Sometimes, tax discounts are also given to manufacture goods.